Menu

The Foxconn Scam

Foxconn may be granted benefits of $3 billion to create 3000 jobs in Wisconsin. Using the power of sensibility, we see how that amounts to spending $1 million of taxpayer-derived money for each of the 3000 jobs. Is that really an efficient use of resources?

What if $75,000 was spent per job, since there are a lot of people who would appreciate having that sort of income? Well, at $3 billion, with $75,000 spent per job, 40,000 jobs would be created. If $50,000 was spent per job, or what could be payed out to hire workers, 60,000 jobs would be created. Obviously there is money that needs to be spent on equipment and such, but I wanted to make a point about $1 million per job versus over a 10th of that per job. I never saw this analysis of potential job creation in the article I’m linking to here or hardly anywhere else.

The arguments that the corporation would have less profits and be less competitive with $50,000-$75,000 per worker job are also terrible. If a firm would have 40,000 grateful new American workers, its productivity and reputation would easily be higher. Thus, there are already enough problems in this society — wrongly putting corporate profits for a few over reducing widespread human suffering only adds to them.

The deal President Trump called “incredible” and Gov. Scott Walker hailed as a “once-in-a-century” opportunity to bring the electronic manufacturing giant Foxconn to Wisconsin wouldn’t generate profits for the state until 2042, a new legislative analysis projects.

The state’s Legislative Fiscal Bureau, a nonpartisan agency that analyzes proposed economic investments, looked at Walker’s bid last month to bring a new flat-screen-display factory to the state in exchange for a roughly $3 billion-incentives package.

Foxconn said it would break ground in southeastern Wisconsin and hire 3,000 workers there over the next four years, with the “potential” to create 13,000 jobs.

If the company hits that growth target, Wisconsin would break even after 25 years, said Rob Reinhardt, a program manager who worked on the report. If 13,000 jobs never materialize, it could take decades longer.